India’s gold imports are likely to exceed last year’s level to around 900 tonnes in the current calendar year on higher demand despite government curbs on its shipments to rein in current account deficit, a top official of World Gold Council said on Monday.
Last year, India, the world’s largest consumer, imported 860 tonnes of the precious metal, while demand stood at 864 tonnes in the same year.
“Looking at the trend in the initial 4-5 months of this year, we expect gold demand and imports to be higher than the last year at around 900 tonnes,” World Gold Council (WGC) India Managing Director Somasundaram PR told PTI. The WGC had projected gold demand at 865-965 tonnes for 2013 calendar year. However, it was expected to be on the higher side of the band considering the demand trend in the first few months of the year, he said.
Domestic demand had increased since the prices had fallen significantly in the last one month, he added.
Prices here have come down from the peak Rs.32,975 in November 2012 to Rs.27,520 per 10 gram now.
Noting that gold still had value, Mr. Somasundaram advised that investors should park some money in gold.
Asked if RBI curbs on gold imports via banks would affect domestic demand, he said Indians bought gold as an investment asset, while the government treated it as an expenditure. “Any attempt to curb import will activate unauthorised channel,” he noted. To rein in current account deficit, the RBI, on Monday, restricted the import of gold on consignment basis by banks, only to meet the genuine needs of exporters of gold jewellery.
